Nasdaq in bear market, Dow falls 414 points

Fox News contributor Liz Peek and FNC contributor James Freeman discuss how a partial government shutdown will affect the stock market and the Federal Reserve’s recent rate hike.

U.S. stocks ended a choppy session on Friday sharply lower with the Nasdaq Composite in bear market territory.

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The tech-heavy index lost 3 percent, or more than 195 points, the Dow Jones Industrials fell over 414 points, or nearly 2 percent, while the S&P shed 2 percent plus, ending the week with a third down session. Investors wrestled with mounting concerns over a partial government shutdown, the ongoing trade spat with China and rising fears that the U.S. could be facing a recession in 2019.

A looming partial government shutdown shook investors who resigned to the view that a budgetary standoff between President Trump and Senate Democrats over border wall funding will in fact result in the government closing.

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Earlier this week, the U.S. House had passed a spending package that included $5 billion for Trump’s campaign-promised border wall. But in the Senate, where 60 votes are needed for passage of the spending bill, the measure appeared dead on arrival.

Amid the selling, investors did get decent economic data. Third quarter gross domestic product (GDP) came in at 3.4 percent in a third update released on Friday, in line with analyst expectations. While that fell slightly from the first reading of 3.5 percent, according to the Commerce Department, it remains in line with the Trump administration’s goal of achieving a 3 percent growth rate in each quarter. However, it was not as strong as the second quarter growth rate of 4.2 percent.

In commodities, falling oil prices are also raising concerns about global economic growth. U.S. crude prices are hovering around the $45 per barrel level and have tumbled over 20 percent this year. "It's getting to a scary point" said former Shell Oil President John Hofmeister during an interview on FOX Business' "Varney & Co."

Looking ahead to the shortened Christmas week: Markets will be open on Monday with an early 1 p.m. ET close for stock trading and all financial markets will be closed on Christmas Day.